Stellar allows payments that are originally denominated in fiat currency, but it also has its native digital currency called Lumens – XLM. The Stellar network requires users to spend a small amount of Lumens – 0.00001 XLM – in order to transfer fiat currencies. This way, Lumens act as bridges with the goal of facilitating trades for currency pairs for which markets are smaller or less liquid.

The Stellar network wants to become a decentralized distributed exchange of any type of assets that people have added to the Stellar network. Its ledger stores both balances held by user accounts and allows buying and selling of assets.

The Stellar distributed network has a built-in, fixed, nominal inflation mechanism. New lumens are added to the network at the rate of 1% each year. Each week, the protocol distributes these lumens to any account that gets over .05% of the “votes” from other accounts in the network.

A large portion of Stellar tokens went directly to the Stellar Development Foundation.
The Stellar foundation airdropped nearly 18 billion of its own tokens to itself. This represented more than $400 million. These tokens represent a supply overhang and can affect current token holders.

Stellar originally based its payment network on the Ripple protocol, but in 2015, it adopted the Stellar Consensus Protocol.

The Stellar Consensus Protocol (SCP) provides a way to reach consensus without relying on a closed system to accurately record financial transactions. SCP has a set of properties that optimize for safety over liveness—in the event of partition or misbehaving nodes, it halts the progress of the network until a consensus can be reached. SCP simultaneously ensures four key properties: decentralized control, low latency, flexible trust, and asymptotic security.